The transmission of socially responsible behaviour through international trade

Abstract

We investigate the relationship between corporate social responsibility (CSR) practices of domestic Vietnamese firms and their engagement with foreign markets. We develop a measure of CSR that combines compliance with labour standards, management commitment to CSR, and corporate community related actions; and find a strong relationship between this measure and participation in international markets. Results suggest that both exporting and importing firms engage in more CSR activities. Conditional on exporting, we show that Vietnamese exporters to China are less involved in CSR related activities, and that exporters to the US engage in more community related CSR. This may reflect differences in stakeholder preferences across markets.